One year of Bouteflika:
Algeria still in turmoil
One year after taking over in strife-torn Algeria, President Abdelaziz
Bouteflika, who staked his presidency on ending bloodshed, is still struggling to curb the
violence tearing the country apart.
His assumption of power on April 15, 1999, was greeted with high hopes
throughout a land exhausted by terror that has claimed an estimated 100,000 lives since
rebels began their campaign in 1992.
Introducing a "civil reconciliation" programme, Bouteflika
had more than 15,000 alleged fundamentalist sympathizers released.
He masterminded an amnesty law, in effect between last July and last
January, to totally or partially pardon rebels deemed not to have perpetrated crimes of
violence or rape, or to have placed the bombs in public places that have caused so much
death and misery among innocent civilians.
It amnestied 1,700 fundamentalists who came forward, and a general
amnesty forgave some 3,000 fighters in the Islamic Salvation Army (AIS), which had
observed a truce since 1997. This is the armed wing of the Islamic Salvation Front
Algeria was plunged into civil war when a second round of elections set
to be won by the FIS were cancelled in 1992. The FIS was banned as a political group and
the AIS was dissolved early this year.
Kuwaiti stocks up
The Kuwait Stock Exchange (KSE) rebounded strongly to close the week
Wednesday up two per cent on the back of growing investor confidence and positive yearly
financial results from most listed companies, analysts said.
The KSE index closed at 1,395.9 points, down 3.2 per cent since the end
of 1999 and 50.8 per cent on its all-time high in November 1997. The index gained 27.2
points, the largest gain in a single week since the start of this year.
OPEC to bank extra $30 bln from oil price surge
Saudi Arabia, Kuwait and other Middle East oil exporters will together
collect an extra $30 billion this year in revenues thanks to higher energy prices, the
International Monetary Fund said on Wednesday.
World oil prices will average about $24.50 a barrel in 2000, up nearly
35 per cent from $18.25 a barrel last year, according to the IMF's world economic
The IMF issued its analysis of the world oil market less than two weeks
after the Organisation of Petroleum Exporting Countries agreed to increase oil production
by seven per cent to ease prices. Crude prices have declined by about $10 from a nine-year
peak of $34.37 a barrel in early March.
The new IMF forecast means that worldwide oil exporters would collect
about $60 billion more in sales this year. "On a regional basis, the bulk of the
higher oil export revenues would accrue to the Middle Eastern exporters, to the tune of
almost $30 billion," the IMF report said.
Oil exporters are expected to use some of the extra money to ease
spending restraints adopted during the 1997-98 slump in oil prices.
Last year, OPEC nations earned a total of $133 billion in oil revenue.
That could soar as high as $211 billion in 2000, according to a US Energy Department
estimate last month, based on the assumption that world prices would average $26.62 a
barrel this year.
The US government said last week that world oil prices would gradually
decline to $23.50 a barrel by the end of this year.
The IMF cautioned that oil prices remain "subject to considerable
uncertainty" over the next few months due to both supply and demand factors.
Iraq, which operates outside OPEC agreements because of international
sanctions, has said it will ramp up production, but it remains unclear how much more crude
the nation will pump.
Saudi investment law wins qualified praise
Saudi Arabia, throwing open its doors to foreign investors, won
qualified praise on Tuesday for a new investment law.
But analysts warned the devil would be in the detail and said it was
unlikely the long-awaited law would spark large foreign inflows immediately, adding the
energy sector was likely to see this first.
"The initial statement sounds good, but the real flavour will be
seen in the details...and only then will we able to see whether it will be attractive
enough for foreigners to come in," one Jeddah-based economist told Reuters.
The law was approved on Monday by King Fahd and allows international
investors to have full ownership of projects and related property in the desert kingdom.
Foreigners have long argued they needed better guarantees and full
ownership rights. They had been limited to 49 per cent stakes in ventures and barred from
owning property in a country where about a quarter of the 20 million people are
Saudi real estate brokers said they expected a boom in the property
sector as soon as foreigners entered the market.
On corporate taxes, the law says the state would "bear 15 per cent
of taxes imposed on company profits exceeding 100,000 riyals ($26,000) a year".
Analysts said this move was likely to reduce taxes imposed on firms
with high profits to 30 per cent from 45 per cent, but some cautioned that the exact
levels were not yet clear.
"We are still missing the actual tax rate that would apply to
businesses. I think as soon as they resolve the tax issue, foreigners will be very
interested in investing," said one Western diplomat.
Arif Sherani, chief economist at Riyadh Bank, said allowing 100 per
cent foreign ownership and reducing corporate tax for foreigners were essential elements
to the law, without which there would have been little point to the overhaul.
Kuwaiti MPs approve 2.5 pct tax
Kuwaiti MPs gave provisional approval for a bill taxing private firms
2.5 per cent on annual profits to finance the employment of Kuwaitis outside the
overstaffed public sector.
The national employment bill, which still requires a second round of
voting next week, would also limit the number of children entitled to social security to
five per family and impose an array of other charges.
The bill introduces new charges on issuing work permits for expatriates
and links winning government contracts and tenders to employing a certain per centage of
nationals, to be fixed later by the government.
Gulf, Europe fail to fix date for free trade block
The six-nation Gulf Cooperation Council (GCC) and the European Union
have not yet agreed during talks here on a date for the start of a planned free-trade
zone, a Gulf official said Tuesday.
"The Europeans are asking for more time before the agreement takes
effect," said GCC official Jabara al-Suraysari, who is in charge of coordinating the
talks between the two sides.
He told reporters here that Tuesday's talks centred on the
classification of exports from the GCC including aluminium, petrochemical and refined oil
He said the two sides would continue discussions at their next meeting,
planned for May in Brussels.
The EU has insisted that the GCC must have its own customs union before
it signs a free-trade agreement with the petromonarchies.
The GCC states, which are currently the fifth largest export market for
the EU, are hit by EU taxes on aluminium exports and petrochemicals of at least six per
MobiNil profits plunge
Mobile phone operator Egyptian Company for Mobile Services (MobiNil)
said on Monday it posted a 61 per cent fall in net profits in the first quarter of 2000 to
35.04 million pounds ($10.14 million).
Etisalat profit slip
United Arab Emirates telecoms operator Etisalat saw revenues surge 21
per cent last year to 1.39 billion dollars but profits slipped two per cent to 537 million
dollars. After record earnings in 1998, the company reported profits of 1.97 billion
dirhams for 1999, 41 million dirhams less than the previous year.
Iran allows private banking
Iran said on Monday it would allow private banking across the country
for the first time since the 1979 Islamic revolution, but would not initially let foreign
banks set up in the country.
"The private sector can establish banks in Iran," Central
Bank Governor Mohsen Nourbakhsh told reporters. Asked if the new regulations would apply
to foreigners, he said: "At present, no." The landmark decision follows a recent
move by parliament to end the state monopoly on banking. Iran nationalised all private
banks after the revolution, in which it became a republic, in an attempt to prevent the
outflow of national wealth.
The decision is part of a five-year plan by President Mohammad
Khatami's government to liberalise and streamline the state-dominated economy, widely seen
The plan, which runs from 2000 to 2005, hopes to achieve ambitious
growth targets, including an average 8.5 per cent rise in private investment.
Merger called off
A planned merger of two United Arab Emirates-based banks to create the
country's largest bank has been "shelved", a newspaper reported Monday.
A senior official of the National Bank of Dubai (NBD) told the Khaleej
Times "there were a lot of hurdles and considerable resistance from the
Jordan joins WTO
Jordan on Tuesday became the 136th member of the World Trade
Organisation (WTO), leaving only six of the 12 Arab states of the Middle East region
outside the Geneva-based body.
Jordan's entry, delayed by a few weeks as a casualty of the collapse of
a WTO Ministerial Meeting in Seattle early in December, came just over six years after the
kingdom began negotiations to join the organisation's predecessor, the GATT.
Jordan's accession was originally set to be approved by existing member
countries in Seattle, but was finally agreed at a meeting of the WTO's ruling General
Council on December 17.
Iran economy grows 2.4 pct
Iran's economy, dominated by oil production, grew by 2.4 per cent in
the year to March, Central Bank Governor Mohsen Nourbakhsh quoted as saying on Tuesday.
Nourbakhsh said Iran's exports grew by 49 per cent to about $19.5
billion, including $16 billion in oil exports, in the year which ended on March 19.
Imports grew by 14 per cent to about $12.5 billion, the official IRNA
news agency quoted him as saying.
The governor said the trade surplus, due to high oil prices in the past
year, had helped reduce Iran's foreign debt, which he said stood at $10.5 billion.
He said inflation was hovering at about 20 per cent.
EU grants 50 mln euros for Lebanese reforms
EU Commissioner for External Affairs Chris Patten signed an accord with
Lebanese officials for the European Union to provide 50 million euros (dollars) to finance
structural reforms here.
"That 50 million is a gesture, a mark of confidence in the reform
process being undertaken here," Patten told reporters.
"We very much admire the reforms which are being introduced and
pushed through by (Finance Minister George) Corm, fiscal reforms and reforms in the
management of the economy," Patten said.
The grant is part of the 184 million euros in direct assistance the
European Union is providing Lebanon under the Euro-Mediterranean partnership
Morocco drafts $7.75-bln
Morocco's government has drafted a 80.2-billion dirhams ($7.75 billion)
six month budget from July that sees a three-percent growth in Gross Domestic Product
(GDP) and inflation at 2.3 per cent.
A copy of the draft budget obtained by Reuters on Friday showed that
the budget deficit is expected to reach 5,073-million dirhams ($490 million) in
July/December 2000, down 36.2 per cent from 7,956 million dirhams in the same period in
The budget forecasts an unchanged current account deficit at around 1.0
per cent of GDP but a 63-percent rise in privatisation receipts to 2,850-million dirhams
($275.3-million) during July/December 2000 compared with the last six months of 1999.
Morocco woos African leaders
King Mohammed VI of Morocco announced this week that his country will
write off the debt of least-developed African countries and scrap all custom barriers for
imports from these countries. The move is seen by independent observers here as a tactic
to win more African support for Rabat's claims over the Western Sahara.
"I declare from this rostrum, that we are cancelling all the debts
owed to Morocco by the least developed African countries, and that we are lifting all
customs barriers for the goods imported from those countries," the King said in a
speech before the Africa-Europe summit, held in the Egyptian Capital city of Cairo.
The debt to be cancelled is valued at 120 million US dollars, the
Moroccan Economy and Finance Ministry said, without disclosing the list of the countries
that will benefit from the exemption decision.
Morocco's imports from these least developed countries remains weak,
standing at 54.6 million US dollars in 1999. The figure represents only 13 per cent of the
Maghreban nation's purchases from Africa as a whole.
UAE surpasses Saudi
The UAE has overtaken Saudi Arabia to become Britain's biggest market
in the Gulf, according to the UAE Gulf News paper dated April 9th.
"The UAE accounted for 37 per cent of our total exports to the GCC
totalling £3.7 billion in 1999, with Dubai alone accounting for £800 million, or 20 per
cent," said Ted Cole of the British embassy in Dubai, according to the paper.
"Our exports to Saudi Arabia declined 40 per cent in 1999. And
while on paper the UAE was within £125 million of our exports to the kingdom, if you take
into account indirect exports of aeroplane engines, the UAE last year overhauled Saudi
Arabia as the UK's biggest GCC market," he said, the paper reported.
Saudi Internet subscribers up
The number of Internet subscribers in Saudi Arabia has grown by more
than 160 per cent since the service was launched last year, the commerce minister said on
"The kingdom now stands among the top five Arab countries in terms
of Internet growth," Commerce Minister Osama bin Jaafar Faqih told an Internet
seminar in Riyadh.
Faqih gave no figures on the number of people with online access in the
oil-rich kingdom, but a Saudi Telecommunications Company (STC) official said in February
there were around 100,000 subscribers in Saudi Arabia and plans were underway to triple
the number of subscribers this year.